In the show's third season, Washington became a central figure in a widely reported backstage controversy. In October 2006, rumors surfaced that Washington had insulted co-star T. R. Knight with a homophobic slur. Shortly after the details of the argument became public, Knight publicly disclosed that he was gay. The situation seemed somewhat resolved when Washington issued a statement, apologizing for his "unfortunate use of words during the recent incident on-set".[2]

The controversy later resurfaced when the cast appeared at the Golden Globes in January 2007. While being interviewed on the red carpet prior to the awards, Washington joked, "I love gay. I wanted to be gay. Please let me be gay".[3] After the show won Best Drama, Washington, in response to press queries as to any conflicts backstage, said, "No, I did not call T.R. a faggot".[4] However, in an interview with Ellen DeGeneres on The Ellen DeGeneres Show, Knight said that "everybody heard him".

After being rebuked by his studio, Touchstone Television (now ABC Studios), Washington issued a statement apologizing at length for using the epithet in an argument with Patrick Dempsey. On January 30, 2007, a source told People magazine that Washington was scheduled to return to the Grey's Anatomy set as early as that Thursday for the first time since entering "executive counseling" after making the comments at the Golden Globes.

However, on June 7, 2007, ABC announced it had decided not to renew Washington's contract, and that he would be dropped from the show. "I'm mad as hell and I'm not going to take it anymore," Washington said in a statement released by his publicist, borrowing the famous line from Network. In another report, Washington stated he was planning to "spend the summer pursuing charity work in Sierra Leone, work on an independent film and avoid worrying about the show".[5] Washington, in late June 2007, began asserting that racism within the media was a factor in his firing from the series.[6] On July 2, 2007, Washington appeared on Larry King Live on CNN, to present his side of the controversy. According to Washington, he never used the "F Word" in reference to Knight, but rather told Dempsey to stop treating him like a "F-word" during an argument "provoked" by Dempsey, who, he felt, was treating him like a "B-word", a "P-word", and the "F-word", which Washington said conveyed "somebody who is being weak and afraid to fight back".[7]

In July 2007, NBC decided to cast Washington as a guest star in a story arc in its new series Bionic Woman. NBC co-chairman Ben Silverman noted his eagerness to work with Washington, saying it would be "like A-Rod leaving the Yankees in midseason". However, Bionic Woman was cancelled after only eight episodes due to low ratings. Washington himself said that his dismissal from Grey's Anatomy was an unfortunate misunderstanding that he was eager to move past. By the beginning of the next season of Grey's Anatomy, Washington's character "Burke" had left the show following the end of the season finale.

In January 2014, in an interview with I Am Entertainment magazine, Washington spoke about life after Grey's Anatomy and he stated, "I don’t worry about whether or not the stories I tell will destroy my acting career because, you can’t take away something that doesn’t exist. They killed the actor (in me) on June 7, 2007."[8]

Washington is playing the role of Chancellor Jaha in The 100, an American post-apocalyptic drama television series that began airing on The CW Television Network in spring 2014. The series is based on a book of the same name by Kass Morgan, and developed by Jason Rothenberg.

Washington married Jenisa Marie Garland on February 14, 1996. The couple have three children. Washington has written a book called A Man from Another Land, which chronicles Washington’s early life, his TV and film career, and his search to find his roots after going through a DNA test that showed his ancestors came from Sierra Leone in West Africa. Since learning about his history, Washington has traveled to Sierra Leone, donated medical supplies to a hospital there, and built a school.[10][11] Washington has endorsed Jill Stein for President of the United States.[12]